Fund Description: First Trust Morningstar Dividend Leaders Index Fund is an exchange-traded index fund or Index ETF which is a separate investment portfolio of First Trust Exchange-Traded Fund, an open-end investment management company. INVESTMENT OBJECTIVE: The First Trust Morningstar Dividend Leaders Index Fund seeks investment results that correspond generally to the price and yield, before fees and expenses, of the Morningstar Dividend Leaders Index. INDEX DESCRIPTION: The Morningstar Dividend Leaders Index consists of stocks listed on one of the three major exchanges, NYSE, NYSE Amex or the NASDAQ, that have shown dividend consistency and dividend sustainability. Through the application of Morningstar, Inc.'s proprietary multi-step screening process, a universe is identified. The top 100 stocks, based on dividend yield, are selected for the Index. The individual holdings are weighted based on each security's shares outstanding, free float factor, and annual indicated dividend per share. The weighting of each holding is capped to enhance portfolio diversification. The Index is reconstituted once annually each June and rebalanced four times annually in March, June, September and December. FUND STRATEGY: The Fund will normally invest at least 90% of its total assets in common stocks that comprise the Index. The Fund, using an indexing investment approach, attempts to replicate, before expenses, the performance of the Index. In seeking to achieve the Fund's objective, the Fund generally will invest in all of the stocks comprising the Index in proportion to their weightings in the Index. However, under various circumstances, it may not be possible or practicable to purchase all of those stocks in those weightings. In those circumstances, the Fund may purchase a sample of stocks in the Index. There may also be instances in which the advisor may choose to overweight another stock in the Index, purchase securities not in the Index which the advisor believes are appropriate to substitute for certain securities in the Index or utilize various combinations of the above techniques or futures or other derivative instruments, in seeking to track the Index. The Fund may sell stocks that are represented in the Index in anticipation of their removal from the Index or purchase stocks not represented in the Index in anticipation of their addition to the Index. FUND MANAGEMENT: First Trust Advisors L.P. is the investment adviser for the Fund.